The Poor are not suffering from Energiewende but from poverty

The Energiewende has recently received a lot of international media attention for its perceived inequity and rising costs to the private consumer. While costs for electricity might be rising in the short term, the overall effects for consumers are much smaller than one would assume reading the reports. Luckily, German civil society is not falling for efforts to discredit the Energiewende, argues Alexander Franke.

The social impacts of the Energiewende have been in the center of media attention in Germany and abroad ever since Peter Altmaier proposed his Strompreisbremse (ceiling on power prices) in February 2013. And who wouldn’t agree: The success of the Energiewende crucially depends on its economic competitiveness and its equitable burden-sharing. Unfortunately, the necessary political debates on the social aspects of the Energiewende are based on shallow discussions that try to distract from the real social issues underlying the challenges Germany faces.

On June 5th, the Fourth Alternative Energy Summit organised by Climate Alliance Germany – an association that includes churches, consumer protection agencies, environmental associations, unions and other societal actors – came together in Berlin to finally have a serious discussion on the social impact of the Energiewende, especially on Germany’s poorest.

The panelists agreed that the recent initiatives have mostly tried to instrumentalize poverty and the poor in Germany against high energy prices, whereas the real reason for this poverty is to be seen in broader inequitable social and economic policies that are not brought up in these discussions at all, such as the high number of temporary workers and the lack of a minimum wage. Klaus Wiesehügel, president of Germany’s union IG Bau therefore pointed out that the Energiewende and the social issues should not be mixed up – instead, the relevant question for the Energiewende should be what kind of energy system Germany should embrace. It was also noted that costs for electricity make up only about 2% of living costs in Germany and have risen significantly less in recent years than prices for fossil fuels that are still the main source of energy for heating (in this context it is important to note that an average German household actually spends about the same amount of money on electricity as an American one due to more efficient consumption).

Overall, the conference praised the Energiewende as an important project that needed to be continued, a sentiment that is widely shared by the German population. Interestingly, social associations and traditionally rather leftist organizations continue to be strong supporters of the Energiewende, while industrial actors, employers’ associations and the like raise the issues with the social aspects of it trying to dismantle the Energiewende (Craig Morris recently gave a stunning example for this reversal in roles).

Of course, participants in this Summit saw the necessity to implement the Energiewende in a more socially fair manner. One particular issue raised was the disproportionate expansion of exemptions and waivers for industrial actors to pay for the Energiewende (something the IEA also criticized recently when commenting on Germany’s Energiewende). The Climate Alliance published a short paper listing other possible measures, ranging from a progressive tax on electricity (thereby rewarding efficiency), increasing payments to recipients of social welfare to compensate for higher energy prices to offering free energy consulting to low income households. Do not get your hopes too high up though: Many other actors are currently crying out loud that the Energiewende is too expensive for the average German consumer. These actors do not seem to have a real interest in finding solutions – instead their aim is to discredit the Energiewende in an effort to prevent necessary adjustments to their current and outdated business models.

In the end it was Hans-Josef Fell, member of the German parliament and one of the original authors of the Renewable Energy Act which paved the way for Germany’s success in the field of renewable energy, who pointed out the double standards of the recent poverty discussions: The same actors demanding a more social implementation of the Energiewende have never before discussed the social impacts and external costs of fossil fuel consumption nor its impact on the world as a whole. Instead studies very clearly show that by 2050 the upfront cost for Germany’s Energiewende will have easily paid for itself, leaving Germany with a less dependent, cheaper and environmentally friendly energy supply. Therefore, the Energiewende should not only be judged by its current and upfront social impacts and costs, but be understood as a social investment for future generations.

3 Comments

It is probably correct that the poor are not suffering from energiewende, everyone is suffering. Energiewende has not been subject to the Strategic Environmental Assessment required by EU Law and the Aarhus Convention. Engineers and scientists have been shunned in favour of hippy green ideologists. Germany needs to be pulled aside and told to wake up before all its industry is gone.It does not matter who supports it, it does not work.

Many thanks for your post. I think you may be a little mistaken in thinking that the German energy transition is only supported by “hippy green idealogists” – this could not be further from the truth! Just check out Craig Morris’ latest post on the overwhelming support of the energy transition among the German public: https://energytransition.de/2013/08/germans-still-overwhelmingly-support-energiewende/ . It is also important to note that the ones that are really winning from this development are the business and industrial sectors that pay a much lower electricity price per kwh thanks to renewables that take on more and more of the market, especially during peak hours. Please don’t forget that especially industry is dependent on a stable energy supply system and the German grid system – with about 25% of renewables – is the most stable system in the world. Industry really will think twice before deciding to leave Germany…